Sharekhan has given Buy recommendation for Wipro with a target price of Rs. 510 in its research report issued on Mar 04, 2021
Sharekhan’s research report on Wipro
Wipro would acquire Capco, an end-to-end management consulting services and digital transformation solutions provider in the BFSI space, in a $1.45 billion all-cash deal. Company’s net cash stood at about Rs. 450 billion as of Q3FY2021. Deal would help Wipro boost its presence in BFSI segment, enhance capabilities, acquire talents and new clients and also win large transformational deals. The addition of 30 financial clients (79% of Capco’s revenue) from acquisition would significantly enhance the access to industry spends. Wipro has redefined its strategic focus to drive growth with speedy decisions in making large strategic M&A in BFSI space, significant staffing changes and hires in leadership positions.
We maintain a Buy on Wipro with an unchanged PT of Rs. 510 given its strategic acquisition of Capco in BFSI space and significant external hires to achieve industry-matching growth.